Division 7A and expert predictions on the future7 March 2020
Be prepared – you won’t be able to lodge your next BAS with AUSkey9 March 2020
Since the second half of 2019, industry super funds have begun to merge their organisations in an effort to combat APRA’s growing potential in taking action against trustees of underperforming funds. While supers are assuring their members that funds are only merging for their best interest, what exactly will the merging of your super fund mean for you?
Supers which are considering merging with their peers are typically only forming partnerships with companies with similar levels of funds under their management. This generally means that there will be no big changes concerning fees or interest rates made to all members despite the merge. The only changes will come with the transferring of certain super accounts and minimal changes in super services, simply due to the fact that one of the two super funds will become the parent company over the other.
In most cases of supers merging, members of one of the two super funds will have their accounts transferred to the other, just for coherence purposes. While the transferring of your super account may seem like a stressful process, the two companies will take into account your existing super options and preferences and will apply similar options to your new super account under the partnered company.
Super members who will have their accounts transferred will also be issued with a guide to the merger, detailing any impacted services and identifying any necessary actions that may be needed before the merge and after it as well. No guides will be given to super members whose accounts will remain under their original fund unless explicitly requested for.
In the case that your super is merging with more than one other super fund, things won’t get much more complicated either. Super funds are generally looking to merge with others which have members from the same industry (e.g. hospitality workers, the general public, corporate workers, etc.) and have similar services so that your transfer will be kept simple and easy. Owning a super account in a larger super fund (due to merging procedures) will also see security benefits, as the chances of your super fund losing out in profits or being targeted by APRA regulations on smaller super companies dramatically decrease.
Overall, if your super were to merge with another, there is no need to stress, as your super fund will most likely merge with others that already have similar interests and account transfers have already been proven to be quite a simple process.